In our previous posts, we discussed the Government’s guidance on the minimum level of energy efficiency required in April 2018 for private rented properties and the Green Deal.

In this post, we will discuss in detail two further options that a landlord can rely on to fund efficiency improvements. In summary, the funding that a landlord may rely on can be one or a combination of the following:

A Green Deal Plan;

Energy Company Obligation or similar scheme;

Funding provided by central government or local authority or third party at no cost to the landlord;

A combination of any of the above.

Energy Company Obligation or similar scheme

ECO is another mechanism that landlords can rely on to fund recommended improvements. ECO is a requirement that the government places on energy suppliers to reduce consumption and assist those living in fuel poverty. It does this by placing a positive obligation on suppliers to provide households, including rented properties, with energy efficiency improvements. The current obligation runs until September 2018 and includes carbon and heating bill savings.

To qualify for the ECO Help to Heat scheme households must be in receipt of one of a list of qualifying means-tested benefits including tax credits and universal credit. Under the ECO Help to Heat Flexible Eligibility scheme, suppliers may deliver up to 10% of heating bill savings obligation to households identified by local authorities as fuel poor or low income and vulnerable to the effects of living in a cold home.

It is important to note that as part of their enforcement duties under the minimum standards regulations, local authorities may identify eligible E, F and G rated private rented properties, and refer them onto energy companies as eligible under ECO. This referral may allow landlords to access supplier obligation support to meet their obligations under the minimum standard regulations. However, a referral does not guarantee any improvement works which are installed at the discretion of the supplier. More details on the scheme can be found here.

Funding provided by central government or local authority or third party at no cost to the landlord.

Many local authorities will run energy efficiency grant schemes from time to time with varying qualifying conditions. This mean that the funding is less likely to be predictable and may be available in one area but not in another. Therefore, due to the varied nature and availability of local funding opportunities, landlords will need to investigate the availability of funding for the area where their property or properties are located.

Comment

It is difficult to say at this stage whether the funding schemes will be effective or not. The possibility of combining schemes may make acquiring sufficient funds a little easier however, looking into schemes and what is and is not available and for whom seems time consuming and complex.